PLEA FOR THRIFT

Poverty Bay Herald, Volume LV, Issue 17176, 5 February 1930, Page 12

PLEA FOR THRIFT

MEETING NEW CONDITIONS DROP IN PRIMARY PRODUCTS ADVICE BY SIR H. BEAUCHAMP ".An unwelcome and drastic change, unfortunately, has occurred in the linancial and trading conditions of the country. This is due to the substantial fail in the prices of our primary products in the overseas markets. Wool, meat, butter, cheese, sheepskins, tallow, and hemp are bringing in less money than a year ago, and it is obvious that the lessened purchasing power of our hard-working 'rural population, and other sections of the community, will be reflected' in the finances and trade of the Dominion during the current year." In these words, Sir Harold Beauchamp, chairman of directors, at the annual meeting of tho Equitable Building and Investment (Jo. of Wellington, Ltd., .sounded a note of warning. "It is singular that primary products in many other, countries have also declined in value to a,serious extent," he said. "Tea, coffee, sugar, cotton, rubber, copra, nitrates, tin, and other raw materials have fallen, pointing to the probability of increased production coincident with a lower purchasing power in Europe. "The changed conditions are not reflected in the past export year, but the figures of the past quarter do indicate the trend. Taking the exports and imports of the Dominion for each' of the past seven years to the end of September, the position is as under:— Yeur Exports Imports Excess of

" It will be observed that up to September 30, .19:29, the ligures are satisfactory, although last year's showing was not as good as in 1928 owing to the increase in imports—the exports being practically even in the two years. The increase shown in imports last year over 1928 amounted to.over four millions, to be exact, £4,058,783. "With two such good export years, with purchasing power of the rural population at a comparatively high level, an increase in imports was justified-; but, unfortunately, nearly, if not quite, 50 per cent, was in respect of the motor trade. I have not the complete figures for the past year, but for the nine months to the end of September there were 22,005 motor vehicles (not including motor-bicycles) imported into the Dominion, valued at £3.279,935, as compared with 11,215 vehicles valued at. £1,681,311, in the corresponding nine months of 1928, an increase of 11,390 vehicles, or over 100 per cent., and £1,593,624 in value, or very nearly 100 per cent. It will, no doubt, be necessary to curtail imports in the current, year, but this should not affect general merchandise to any serious extent; but tho imports of motor vehicles and accessories will stand a good deal of curtailment. "The changed conditions of tho foreign trade of the country, particularly during the past three months, are reflected in the deposits and advances of the six .trading banks. "The excess of deposits of £3,500,000 in 1928 is turned into an excess of advances of £451,198. As compared with December, 1928, the advances show an increase of but 'of this amount of additional credit obtained from the banks £1,695,327 has been retained in tho Dominion as shown by the increase in deposits, leaving £4,011,500, which has been apparently transferred overseas to pay for the increased imports, which, -as shown above, total £4,058,783. SHRINKAGE IN INCOME

"What tho shrinkage in income from exports will amount to this year can be only a matter of guesswork," proceeded Sir Harold, "but there is every indication that it will be substantial. "The fall in wool has caused u good ileal of loose talk of a pessimistic nature which is much to be deprecated. Wool, together with most of our other export products, is still realising better prices than before the Avar, but the lesson to be learned from the falling markets is that we must readjust our ideas of values, "It is probable that credit facilities will 1)0 strained somewhere, and money rates may go higher; indeed, that is already indicated by the Government placing a loan on the local market at 5J per cent, at par. instead of 5} per cent., the rate at which the Government was recently selling debentures over flie counter. Personally, I consider the Government, under the existing monetary conditions, could not expect to raise money hi.tho Dominion at less than the rate now offered. The lending power, however, of Ihis and other financial institutions will be adversely affected by the adsorption of so much money by the • State. It is admitted that the pros-, perity of this country is chiefly dependent upon trading and industrial activity in Great Britain, both of which to-day arc at a particularly lowebb. Until, therefore, a distinct improvement in those conditions occurs, two must feel the repercussion in the Dominion. In the meantime it behoves all classes of the community to work harder, spend less on luxuries, and generally to readjust their method of living in such a manner as will enable them to meet the less favorable, financial conditions with -which wo are faced."—Dominion.

to Sep. SO £ £ £ 1923 45.171,560 41,202,186 3,969,374* 1924 40,438,267 48,034,454 1,398,813* 1025 55,746,757 50,624,654 5,122,103* 1026 43,417,988 51,525,968 3,208,030f 1027 45,845,343 45,992,934 147,591f 1928 56,248,503 44,140,402 12,108,191* 1929 56,174,!)33 48,199,185 7,975,148* *Kxports. flmports. BIG INCREASE IN MOTOR VEHICLES